WEBVTT - France's Macron Will Disrupt Everything, Publicis CEO Says 0:00:00.120 --> 0:00:02.920 Brought you by Bank of America, Mary Lynch. Investing in 0:00:03.000 --> 0:00:07.840 local communities, economies and a sustainable future. That's a power 0:00:08.080 --> 0:00:12.360 of global connections. Mary Lynch, Pierce Fenner, and Smith Incorporated 0:00:12.760 --> 0:00:26.400 Member s I p C. Welcome to the Bloomberg Surveillance Podcast. 0:00:26.440 --> 0:00:29.920 I'm Tom Keene with David Gura. Daily we bring you 0:00:29.960 --> 0:00:34.800 insight from the best of economics, finance, investment, and international relations. 0:00:35.240 --> 0:00:40.760 Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, Bloomberg dot Com, 0:00:40.800 --> 0:00:47.960 and of course, on the Bloomberg Born On a Monday, 0:00:48.000 --> 0:00:50.840 the eighth of May. This is Bloomberg Surveillance on Bloomberg Radio. 0:00:50.880 --> 0:00:53.400 David Gura in New York, Tom Keen in Paris, where 0:00:53.400 --> 0:00:56.000 plans are underway for the inauguration of a new president, 0:00:56.080 --> 0:00:59.960 Centrist Dimmanuel MCom on s percent of the votes yesterday. 0:01:00.040 --> 0:01:03.080 Far right candidate Marine Leapann had Th mccuonne will take 0:01:03.080 --> 0:01:05.839 office on Sunday. In between now and then, we expect 0:01:05.840 --> 0:01:08.720 to get details on who will comprise his cabinet, and 0:01:08.760 --> 0:01:11.000 we'll be France's next Prime minister. On the show today, 0:01:11.000 --> 0:01:14.240 a host of great guests from France economists, political scientists 0:01:14.520 --> 0:01:16.480 and investors and Rocher Charma will join us here in 0:01:16.480 --> 0:01:20.240 New York, the chief global strategist at Morgan Stanley. I 0:01:20.280 --> 0:01:23.479 believe my co host Tom Keane has made his way 0:01:23.480 --> 0:01:26.080 from the TV studio to the radio. Sto, Tom, we 0:01:26.160 --> 0:01:31.559 have Bravo yesterday. That was a marathon performance, but well done. 0:01:31.560 --> 0:01:35.280 You was wonderful to capture the moment. David Gura on 0:01:35.319 --> 0:01:38.039 the River Sin as all of our listeners know that 0:01:38.160 --> 0:01:41.600 had the privilege of coming U to France, to be 0:01:41.680 --> 0:01:44.920 on the sand by the Eiffel Tower. Uh, it was 0:01:45.040 --> 0:01:48.160 just absolutely fabulous. And then to walk over later that 0:01:48.280 --> 0:01:52.240 evening to the Chasa Lise and to see the celebration, 0:01:52.800 --> 0:01:55.760 the horns hawky and the flags waving was really something. 0:01:55.840 --> 0:01:58.280 And of course we all saw the drama the Louver 0:01:59.280 --> 0:02:02.840 as well. David, what was the view from the U 0:02:03.000 --> 0:02:06.680 S What was your takeaway from the festivities in France? Yeah, 0:02:06.720 --> 0:02:08.200 I mean I think that we we were all looking 0:02:08.200 --> 0:02:10.520 to see obviously what this would mean domestically, what this 0:02:10.560 --> 0:02:12.560 is gonna mean for politics in France. But for those 0:02:12.600 --> 0:02:14.640 of us who watched what happened in the Netherlands unfold 0:02:14.639 --> 0:02:17.360 and wondered if we would see a similar move away 0:02:17.360 --> 0:02:20.360 from from the populist currence in France. It was confirmation 0:02:20.400 --> 0:02:23.480 with the fact that maybe the strength of that populist 0:02:23.480 --> 0:02:25.720 movement wasn't what we thought it was just a few 0:02:25.760 --> 0:02:28.320 months ago. Let me bring in our steam Gas. I 0:02:28.320 --> 0:02:30.200 guess if you start strong, would you like to do 0:02:30.240 --> 0:02:34.119 at Bloomberg Surveillance. You can do no better in France 0:02:34.240 --> 0:02:38.600 than Maurice Levy, his decades of experience at Publiss, his 0:02:39.200 --> 0:02:43.280 visibility within the world at Davos and other organizations, but 0:02:43.360 --> 0:02:46.920 of course, far more importantly his affection for his France more. 0:02:46.919 --> 0:02:49.280 Its wonderful to have you with us, with David Gura 0:02:49.320 --> 0:02:52.359 and in New York. You gave us a wonderful history 0:02:52.440 --> 0:02:56.520 lesson earlier of de gal through this fifth Republic, we 0:02:56.600 --> 0:03:00.320 spoke of a sixth Republic and the generational change. How 0:03:00.360 --> 0:03:04.160 does Mr mccam bring the rest of France towards them? 0:03:04.200 --> 0:03:07.720 It is a fractuous nation, isn't it. First of all, 0:03:07.760 --> 0:03:10.360 thank you for having me. I'm very happy to share 0:03:10.400 --> 0:03:14.280 if you use and what happened. I think that imagine mccon, 0:03:14.840 --> 0:03:17.880 we disrupt everything, and they will try at least to 0:03:18.000 --> 0:03:22.880 disrupt everything. We never had a president so young in 0:03:22.960 --> 0:03:28.520 France since Napoleon, and we never had someone who has 0:03:28.680 --> 0:03:32.360 the will and the determination to change things and to 0:03:32.400 --> 0:03:36.160 address the real issues. We are facing a lot of 0:03:36.720 --> 0:03:41.480 problems and issues, and if you look only at the 0:03:41.560 --> 0:03:45.360 internal situation of France, we need to fix an employment 0:03:45.400 --> 0:03:48.440 which is a very high, more than ten percent. We 0:03:48.480 --> 0:03:52.440 need to fix the depth which is more than one percent. 0:03:52.680 --> 0:04:01.520 We need to fix the taxes and all the social 0:04:01.600 --> 0:04:06.920 charges which are weighing too much in the growth of 0:04:07.040 --> 0:04:11.119 our country, and we have to change liberal laws. When 0:04:11.160 --> 0:04:14.200 you look at everything that he has on his plate, 0:04:14.720 --> 0:04:18.440 you can see that it is a big, big undertaking 0:04:18.560 --> 0:04:23.000 that he has in front of him. So we all 0:04:23.120 --> 0:04:26.320 wish that it will be successful. We are all very 0:04:26.400 --> 0:04:31.839 supportive because it is hope that happened yesterday, more than 0:04:31.880 --> 0:04:35.799 the election, more than any of the former election. Maybe 0:04:35.800 --> 0:04:38.880 the only one which is comparable and very different at 0:04:38.920 --> 0:04:42.680 the same time is when Mita has been elected in 0:04:42.800 --> 0:04:49.200 eighty one, as the Socialists have been out of government 0:04:49.279 --> 0:04:53.359 for more than twenty years, it was huge for a 0:04:53.440 --> 0:04:57.920 lot of for half of France. Here it's something which 0:04:58.040 --> 0:05:02.640 is very different because it is first and foremost with 0:05:02.720 --> 0:05:07.360 the young generation, and you have seen that yesterday at 0:05:07.440 --> 0:05:12.839 the Louver with all these young black blob as we say, 0:05:13.000 --> 0:05:18.080 where you have the Black, the Arabs and the Caucasian 0:05:18.240 --> 0:05:22.960 the classication together and this has been the first since 0:05:23.600 --> 0:05:28.320 the World Cup of and we see that there is 0:05:29.279 --> 0:05:33.280 a momentum of hope which is quite uniquet. We're bringing 0:05:33.360 --> 0:05:35.320 David Curry in New York. David More, it's great to 0:05:35.320 --> 0:05:36.680 speak with you once again. Of course we know of 0:05:36.760 --> 0:05:40.080 your your background in advertising. The message so important to you. 0:05:40.440 --> 0:05:43.280 What was it about this candidate's message that resonated so 0:05:43.320 --> 0:05:46.599 well and so widely in France. I think that the 0:05:46.640 --> 0:05:49.560 message was himself. I think that the message was not 0:05:49.680 --> 0:05:53.640 so much because when you go through the program, it 0:05:53.760 --> 0:06:00.240 has not been a program which came as one un 0:06:00.520 --> 0:06:05.680 solid program at the beginning of his journey. It was himself. 0:06:05.720 --> 0:06:10.600 It was the rejuvenation and I think that the fact 0:06:10.720 --> 0:06:15.680 that it was rejuvenating and breaking down all the silos. 0:06:15.720 --> 0:06:18.840 And it was also this very important message which was 0:06:19.240 --> 0:06:24.159 negosh need what no left, not right and it didn't 0:06:24.160 --> 0:06:28.320 want to be portrayed as a representative of the right 0:06:28.360 --> 0:06:31.520 wing or the left wing. He didn't want to be 0:06:31.600 --> 0:06:39.360 seen as a socialist and no at a as only conservative, 0:06:40.279 --> 0:06:43.719 and I think that the Negosh need what is probably 0:06:43.760 --> 0:06:47.719 what has been the most important message which has been 0:06:47.760 --> 0:06:51.440 well received by most of the young people. They didn't 0:06:51.960 --> 0:06:58.720 see with the old parties, a representation of the hopes 0:06:58.960 --> 0:07:02.560 and who they are. It was some sixty four some 0:07:02.720 --> 0:07:06.680 years ago that you came from Morocco explained to us 0:07:07.360 --> 0:07:11.160 where the ghosts of the Arab world will will go 0:07:11.840 --> 0:07:14.880 for France if we look at Algiers, the collapse of 0:07:14.880 --> 0:07:18.760 Algiers and all of the decolonization, what will happen now 0:07:19.160 --> 0:07:22.640 to that historic tension that we see in Paris and 0:07:22.720 --> 0:07:26.840 frankly polarizing around all of France. How will that change 0:07:26.920 --> 0:07:31.720 under mcrow? When I arrived, there was a Chinda and 0:07:31.800 --> 0:07:34.760 that was the first born in Morocco because my family 0:07:35.000 --> 0:07:39.400 was a refugee because of the war. So it's I'm 0:07:39.440 --> 0:07:43.400 not a fair representative. I understand that, but you've lived that, 0:07:43.720 --> 0:07:47.520 You've lived showing up yes, definitely, And I think that 0:07:49.720 --> 0:07:57.120 along the years we have created the situation where we 0:07:57.240 --> 0:08:05.520 opposed generation to generation, communities to other communities, and instead 0:08:05.560 --> 0:08:08.680 of trying to unite the people and to create one 0:08:08.720 --> 0:08:14.640 single country with one single community, everything that has been done, 0:08:15.280 --> 0:08:20.160 if you look at the last fifty years was to 0:08:20.280 --> 0:08:29.120 fragment the country not only between refugees and French roots people, 0:08:29.600 --> 0:08:34.520 it is also between the people coming from the countryside 0:08:34.600 --> 0:08:36.920 and the people in the cities, the people of the 0:08:37.040 --> 0:08:40.240 universities and the people who have no education of very 0:08:40.240 --> 0:08:45.360 little education. All these has created the situation where we 0:08:45.520 --> 0:08:51.520 have a highly fragmented country. And despite the will that 0:08:52.040 --> 0:08:56.560 a Lord of sar Cozy or even she had had 0:08:56.800 --> 0:09:01.960 to change the situation, no one has clearly a dry 0:09:02.400 --> 0:09:04.199 So I was talking to David Kerr about to see 0:09:04.200 --> 0:09:06.400 the other day David can jump in here very quickly 0:09:06.520 --> 0:09:09.360 because David, this is where Mr McCraw has to be 0:09:09.400 --> 0:09:13.320 different than these previous leaders. Yeah, you know you mentioned 0:09:13.360 --> 0:09:14.840 here more he's just a moment ago that he's going 0:09:14.920 --> 0:09:18.079 to try to disrupt everything. How difficult is it going 0:09:18.120 --> 0:09:19.600 to be for him to do all of this. We 0:09:19.640 --> 0:09:22.240 can talk about the minutia of getting parliamentary votes and 0:09:22.400 --> 0:09:24.640 all that, but just to keep up this momentum, how 0:09:24.679 --> 0:09:29.160 hard is that everything? We start with the choice of 0:09:29.880 --> 0:09:34.080 the Prime minister, because mccon would not be able to 0:09:34.200 --> 0:09:36.640 run for election and he will not be able to 0:09:36.760 --> 0:09:40.280 do anything. Els that one or two speeches on TV 0:09:41.040 --> 0:09:43.680 to for the lationship. Would you serve as Prime Minister. 0:09:44.040 --> 0:09:47.480 I'm sure you're on the short list. I'm not because 0:09:47.559 --> 0:09:51.079 what he needs to do first, I'm too old. And 0:09:51.200 --> 0:09:53.440 the second aspect is what he needs to do is 0:09:53.480 --> 0:09:58.440 to have somebody who is experienced with the political parties 0:09:58.920 --> 0:10:02.320 and who knows how to run elicious lative election, which 0:10:02.360 --> 0:10:06.120 is very different from a presidential and he has to 0:10:06.280 --> 0:10:11.240 have somebody who really very well versed. He has some options, 0:10:11.559 --> 0:10:15.360 and the probably that he's one of the options to leave, 0:10:15.360 --> 0:10:17.079 We've got to leave it there. Thank you so much, 0:10:17.120 --> 0:10:20.679 Thank you generous, Thank you Bloomberg. Today, I'm Bloomberg Television, 0:10:20.720 --> 0:10:24.280 of Bloomberg Radio. He needs no introduction worldwide. Marias Lee, 0:10:24.320 --> 0:10:27.120 they of course of Boobliss, David Gurr and New York. 0:10:27.160 --> 0:10:30.959 I'm Tom Keene in Paris. Stay with us. This is Bloomberg. 0:10:44.040 --> 0:10:46.640 Continue to cover and analyze the results of the French 0:10:46.679 --> 0:10:48.959 election yesterday. Richard Datis joins us now formerly of the 0:10:48.960 --> 0:10:51.679 Booblist Group, now chairman of Richard Datius and Associates. Here 0:10:51.720 --> 0:10:54.000 in our Bloomberg eleven three oh studios in New York. 0:10:54.000 --> 0:10:55.920 It's great to have you with us, and I wonder 0:10:55.880 --> 0:10:58.760 if we could start with just your sense of the 0:10:59.080 --> 0:11:01.800 lasting effects of this campaign For an outside observer here 0:11:01.840 --> 0:11:04.520 in New York, it lasted a long time. Just judging 0:11:04.559 --> 0:11:07.360 from that that last debate, it was at times acrimonious. 0:11:07.480 --> 0:11:08.800 Where do we go from here? How do how do 0:11:08.800 --> 0:11:12.760 we move past the legacy of this campaign? We we 0:11:13.000 --> 0:11:17.959 definitely understood now that move than I would say to 0:11:18.280 --> 0:11:22.800 million people in France are ready to vote for an 0:11:22.840 --> 0:11:27.079 extreme And this is I think, unfoldedly the first lesson, 0:11:27.880 --> 0:11:32.120 populism is really next door. And despite the election of 0:11:33.200 --> 0:11:39.360 President mccron, we still be very cautious about what these people, 0:11:39.480 --> 0:11:45.000 these voters could represent and could also make as a 0:11:45.120 --> 0:11:49.240 constraint for the new elected president. Two, I would say, 0:11:49.280 --> 0:11:52.120 implement what he has in mind. So this is I think. 0:11:52.120 --> 0:11:55.480 And for the first lesson, the second lesson is that 0:11:56.200 --> 0:12:00.760 France and this is the half full glass I say, 0:12:00.800 --> 0:12:03.520 which we have to think in mind. To keep in mind, 0:12:04.080 --> 0:12:08.319 is that a very young, talented man who came from 0:12:08.360 --> 0:12:12.040 the private sector, not at all from the political system, 0:12:12.160 --> 0:12:15.640 very audacious, was able to make it, which means that 0:12:15.760 --> 0:12:18.800 France is able or so to achieve great things and 0:12:18.840 --> 0:12:22.240 some people are still are now dreaming and hoping that. 0:12:22.440 --> 0:12:24.720 I would say, in addition of the American dream, you 0:12:24.720 --> 0:12:27.160 can have the French dream. So everything is possible also 0:12:27.200 --> 0:12:31.360 in France, which I think it's very positive and and 0:12:32.000 --> 0:12:35.800 I think that the new elected president, thanks to his days, 0:12:36.400 --> 0:12:39.120 very audacious. Thanks to his I would say, he has 0:12:39.120 --> 0:12:41.560 nothing to lose at the end of that day. So 0:12:41.720 --> 0:12:43.559 I hope that he will be able to implement the 0:12:43.600 --> 0:12:47.560 reforms which are really absolutely needed in France for years 0:12:47.600 --> 0:12:50.640 and years and years. Let's tackle those in kind. Listening 0:12:50.679 --> 0:12:52.679 to the speech by the president elect last night, he 0:12:52.720 --> 0:12:55.000 said he hoped that voters would never have to way 0:12:55.120 --> 0:12:58.160 voting for extremist candidates. Again, when you look at Marine 0:12:58.200 --> 0:13:00.920 Lapan and what happens next to her and to her party, 0:13:01.120 --> 0:13:04.360 what do you say She's she's positioning herself as the 0:13:04.360 --> 0:13:06.839 opposition figure here says that her party will be the 0:13:06.840 --> 0:13:09.839 opposition party. What what's your sense of the future of 0:13:09.840 --> 0:13:12.640 the National Front in France. You know, she's a tough cookie, 0:13:13.000 --> 0:13:16.560 and she knew how to reinvent the party, and she 0:13:16.640 --> 0:13:20.760 knew how to attract more voters. And even yesterday she 0:13:20.880 --> 0:13:24.960 opened a window saying that maybe she will even rebrand 0:13:25.000 --> 0:13:28.560 the party. So she sees herself and she has a 0:13:28.559 --> 0:13:32.720 great window of opportunity because the Right Party is quite divided. 0:13:33.400 --> 0:13:37.600 The Socialist Party is also more than divided, so she 0:13:37.720 --> 0:13:41.320 has huge room to become, I would say, the first 0:13:41.360 --> 0:13:45.920 party of opposition. And this is quite scary because, as 0:13:45.960 --> 0:13:50.600 you perfectly said, the presidential debate was really a demonstration 0:13:51.080 --> 0:13:54.920 that she doesn't care about even lying, even putting wrong 0:13:55.120 --> 0:13:59.680 facts on the table, just to destabilize everyone. Unfortunately, people, 0:14:00.120 --> 0:14:05.520 friends who are job less, hopeless. It's it's an easy, easy, easy, 0:14:05.640 --> 0:14:10.480 I would say, community to say, duced with his fake's arguments. Richard, 0:14:10.520 --> 0:14:14.280 good morning from your Paris. Wonderful to have your respective 0:14:14.920 --> 0:14:17.680 uh today. This has been one of my themes here. 0:14:18.400 --> 0:14:21.680 Is there a tinge of Anglo American and Mr McCraw 0:14:21.880 --> 0:14:24.640 or is he going to be a uniquely French president? 0:14:25.080 --> 0:14:27.200 Oh no, I think he will be a global leader. 0:14:27.440 --> 0:14:31.280 I think he is definitely and I hope that the 0:14:31.720 --> 0:14:34.640 very In two weeks, as you know, the G seven 0:14:35.040 --> 0:14:38.640 meetings happened in Sicilia, and this will be for him 0:14:38.720 --> 0:14:42.720 the best opportunity to show to his pairs from the US, 0:14:43.480 --> 0:14:46.760 including the U S President, including the Prime Minister of 0:14:46.840 --> 0:14:51.040 Canada and many others who sent him nice congratulations message 0:14:51.280 --> 0:14:55.760 yesterday that they have to count with him. And and 0:14:55.880 --> 0:14:59.200 he's a global citizen, so you know, during his campaign 0:14:59.240 --> 0:15:02.640 he did very well in the US, he did very 0:15:02.680 --> 0:15:05.760 well in the UK with the French jas Bora. So 0:15:05.840 --> 0:15:10.320 I think he has a definitely a vision to be 0:15:10.480 --> 0:15:12.600 part of the globe. Richards will come back in just 0:15:12.640 --> 0:15:15.600 a moment, David Gura, it's a guess that we would 0:15:15.680 --> 0:15:19.160 always speak to in Paris. But you're joining his intendance 0:15:19.240 --> 0:15:21.680 in our studios in New York City's John Tucker. And 0:15:21.720 --> 0:15:23.520 I joined his company very much here in our Bloomberg 0:15:23.520 --> 0:15:25.720 eleventh three oh studis Richard Attius with us here chairman 0:15:25.720 --> 0:15:29.040 of Richard Addis and Associates. And I was looking back 0:15:29.240 --> 0:15:31.960 reading rereading a profile by Alyssa Reubin of The New 0:15:32.040 --> 0:15:34.120 York Times of the now president elect, and she wrote, 0:15:34.400 --> 0:15:38.080 he's gambling that his postpartisan philosophy matches the national mood. 0:15:38.640 --> 0:15:40.880 What was it about politics in France at this point 0:15:40.880 --> 0:15:44.600 that encouraged voters to look outside the traditional party system? 0:15:44.600 --> 0:15:47.760 Where does the Republican Party, the Socialist Party go from here? 0:15:47.760 --> 0:15:50.200 In light of the fact that this upstart party has 0:15:50.240 --> 0:15:55.640 seen its candidate become the next president. In fact, uh 0:15:56.000 --> 0:16:00.400 VCS was really predictable for more than one year. I 0:16:00.400 --> 0:16:05.000 would say all the French citizens were explaining that they 0:16:05.000 --> 0:16:09.760 were not anymore attracted by the traditional political parties. So 0:16:09.880 --> 0:16:14.200 definitely they have to reinvent themselves, no questions. And the 0:16:14.280 --> 0:16:18.360 reason why Emmanuel Macron was elected is that definitely he 0:16:18.440 --> 0:16:21.480 symbolized not just the fact that he's a young potential leader, 0:16:21.520 --> 0:16:24.400 but he's really a centrist. So he's a guy who 0:16:24.440 --> 0:16:28.160 was able to be a catalyst between I would say, 0:16:28.200 --> 0:16:31.640 some leaders from the right party and some leaders from 0:16:31.680 --> 0:16:34.640 the left party. And this is happening so today, and 0:16:35.000 --> 0:16:37.920 you know, many people say it France is an unmanageable 0:16:37.960 --> 0:16:40.560 country for years, but why it was? It is an 0:16:40.600 --> 0:16:45.600 unmanageable country because the French people, frankly speaking, they want 0:16:45.640 --> 0:16:48.080 to do not to be seen as left or right. 0:16:48.520 --> 0:16:51.320 They are much more open and they want to be 0:16:51.360 --> 0:16:54.400 seen more as a centrists. And this is what is happening. 0:16:54.640 --> 0:16:58.400 So if in six weeks from now, Emmanuel mccron is 0:16:58.440 --> 0:17:03.480 able to win the parliament elections, this will be a 0:17:03.520 --> 0:17:07.960 tremendous change in the whole political field in France because 0:17:08.000 --> 0:17:11.199 a party which was created just a year ago able 0:17:11.240 --> 0:17:16.080 to get the majority. This will really show that the 0:17:16.080 --> 0:17:18.880 whole landscape, the political landscape, has changed, and I think 0:17:18.920 --> 0:17:22.720 this will happen, and this could happen because this is 0:17:22.720 --> 0:17:26.920 the only way to really fight and resist against the extremism, 0:17:27.160 --> 0:17:30.200 because the Front National is just not a populist party, 0:17:30.320 --> 0:17:33.280 is an extremist party, and this has to be understood. 0:17:33.320 --> 0:17:37.520 You know, when when you watch the presidential debate a 0:17:37.520 --> 0:17:41.560 few days ago, you really realized that Marine le pen 0:17:42.280 --> 0:17:46.760 is not Maybe she customized herself with some cosmetic to 0:17:46.880 --> 0:17:49.240 be a little bit different from her the perception we 0:17:49.320 --> 0:17:52.040 had from her father, but in fact I think she's 0:17:52.119 --> 0:17:56.880 absolutely identical. She was a pathological liar during this election. 0:17:56.960 --> 0:18:00.280 I can't tell you really by saying some facts which 0:18:00.280 --> 0:18:03.720 are absolutely wrong. It was not about fake news. It 0:18:03.800 --> 0:18:07.800 was about fake informations which were really really dangerous for 0:18:07.880 --> 0:18:10.399 people who are just watching. And you have no clue 0:18:10.640 --> 0:18:13.600 about what is really the reality of the economy, the 0:18:13.680 --> 0:18:18.040 reality of many other aspects of the French economy and 0:18:18.080 --> 0:18:21.879 the French I would say position in foreign policy, Richard, 0:18:21.880 --> 0:18:24.240 how how do you how do you keep political engagement 0:18:24.520 --> 0:18:26.679 high in France. In other words, you have enthusiasm for 0:18:26.720 --> 0:18:30.159 a young candidate now president elect. You look though at 0:18:30.160 --> 0:18:32.399 a court of the French electric staining from voting in 0:18:32.400 --> 0:18:35.440 this election, pushing ahead of the parliamentary election. That Mr 0:18:35.480 --> 0:18:37.639 McConn is going to need people to stay engaged with 0:18:37.640 --> 0:18:40.760 what he's doing. It's it's a very important question, you know. 0:18:40.840 --> 0:18:44.520 He I think today Emmanuel mccon should do whatever is 0:18:44.520 --> 0:18:49.520 possible to become a brand. When Prime Minister Trudeau Trudeau 0:18:49.720 --> 0:18:53.480 was elected in Canada, I remember that many people were 0:18:53.520 --> 0:18:57.119 asking is Canada could become again a brand thanks to 0:18:57.359 --> 0:19:00.679 Trudeau who would like to play a big role. Definitely. 0:19:00.920 --> 0:19:03.760 This is the same opportunity which is offered to Emmanuel 0:19:03.840 --> 0:19:07.480 mcron So he has to become a brand, and he 0:19:07.600 --> 0:19:11.919 has to support and to make friends. Becoming back I 0:19:11.920 --> 0:19:14.480 would say on the on the global road Map, and 0:19:14.600 --> 0:19:18.040 this will I think encourage many people to come back 0:19:18.080 --> 0:19:22.440 in in supporting politics and be interested by politics because 0:19:23.320 --> 0:19:27.920 he will be a new voice, a new language, and 0:19:28.040 --> 0:19:31.320 I think he will not just reinvent the political field, 0:19:31.520 --> 0:19:36.200 but he has also to reinvent the dialogue between the society, 0:19:36.600 --> 0:19:40.600 the use and the political leaders. For me, he is 0:19:40.680 --> 0:19:46.719 probably a potential public private partnership you know symbol. And 0:19:46.960 --> 0:19:49.560 because he knows very well the private sector, he is 0:19:50.240 --> 0:19:54.000 probably the first elected president and the first president who 0:19:54.119 --> 0:19:57.800 is really coming from a great experience in the private sector. 0:19:58.280 --> 0:20:02.199 So we need to reconsiderate the civil society and the 0:20:02.240 --> 0:20:06.600 political society, the prime minister position and friends, Richard explain 0:20:06.640 --> 0:20:09.960 to our global audience what the prime minister does in 0:20:10.119 --> 0:20:13.800 France and will it be someone like Mr McCraw or 0:20:13.840 --> 0:20:18.320 do is he bringing someone from his diverse outside. This is, 0:20:18.400 --> 0:20:21.160 as you know, since you're in Paris, the most important 0:20:21.240 --> 0:20:23.679 question that everyone is asking today is who will be 0:20:23.760 --> 0:20:26.040 the next prime minister. Prime Minister in France is a 0:20:26.160 --> 0:20:28.720 very important job. He's a guy who is running the government. 0:20:29.080 --> 0:20:31.719 He's a guy who is implementing i would say, the 0:20:31.840 --> 0:20:35.880 strategy and the policies, and he has more less full 0:20:35.920 --> 0:20:37.920 power to run the country at the end of the day, 0:20:37.960 --> 0:20:43.360 because he's not just a ghost of the president. And 0:20:43.359 --> 0:20:46.360 and this is why everyone is waiting to know who 0:20:46.400 --> 0:20:48.639 will be the next prime minister, which would be probably 0:20:48.760 --> 0:20:51.440 announced in one week from now, but also who will 0:20:51.480 --> 0:20:54.560 be the winning party in the parliament election in six 0:20:54.600 --> 0:20:58.359 weeks from now, because by definition the winner, the party 0:20:58.400 --> 0:21:01.359 who will win, will have to run the government. Having 0:21:01.440 --> 0:21:04.639 said that, and I would say that the French people 0:21:04.680 --> 0:21:07.960 are expecting two things. Number one, to have the next 0:21:07.960 --> 0:21:11.320 prime minister to be someone with a solid experience, to 0:21:11.480 --> 0:21:14.040 bring a great expense on the table, next to a 0:21:14.119 --> 0:21:18.359 young leader who Emmanuel Marquin is not so experienced to 0:21:18.440 --> 0:21:21.240 be honest in politics because he started three years ago, 0:21:21.320 --> 0:21:25.600 which is yesterday. And too they need someone very solid 0:21:25.680 --> 0:21:29.080 who will be able to resist in these difficult times 0:21:29.080 --> 0:21:34.000 of terrorism, of really dealing with Isis. And this is 0:21:34.000 --> 0:21:38.359 what people are expecting, I know, as the ugly American Richard, 0:21:38.400 --> 0:21:41.720 which you've called me three times before. In Paris, the 0:21:41.760 --> 0:21:43.879 world ends at the Arc de tree Off, I believe, 0:21:43.920 --> 0:21:47.280 to the south, there's a whole another France. How is 0:21:47.400 --> 0:21:50.520 Mr McCray to be taken in the cities like Leon 0:21:51.320 --> 0:21:54.359 or Niece or too long? Tell me about Leon and 0:21:54.560 --> 0:21:58.480 what this election means for the second city of this nation, 0:21:59.520 --> 0:22:03.240 you know, I think when you look at different cities, 0:22:03.960 --> 0:22:07.800 Emmanuel mccron was elected with a very high ranking, except 0:22:07.840 --> 0:22:11.000 in the southeast of France, you know, and excepting Corsica, 0:22:11.880 --> 0:22:18.000 where even he was more less fifty two for for 0:22:19.000 --> 0:22:24.800 UM Marine Leepen. Why France is very divided, as you 0:22:24.920 --> 0:22:28.720 also saw during the first round, the north was really 0:22:28.800 --> 0:22:32.000 voting more for Marine Deepen, where the south and the 0:22:32.040 --> 0:22:37.080 west was more voting for UM Emmanuel mccron. Why that, 0:22:37.680 --> 0:22:40.960 because it's depends on the demography of of the of 0:22:41.040 --> 0:22:44.320 the country. In the north you have many people who 0:22:44.359 --> 0:22:49.000 are very low income, many job less. They lost jobs 0:22:49.000 --> 0:22:51.960 because they were working in mining industries, in all these 0:22:52.000 --> 0:22:56.000 industries which are disappearing, and because they are hopeless, they 0:22:56.080 --> 0:22:59.760 think that voting for Marine Deepen they have nothing to lose. 0:22:59.760 --> 0:23:01.600 On ab she will be the one who would bring 0:23:01.600 --> 0:23:05.879 a solution. So I have to say that in big 0:23:05.920 --> 0:23:10.800 cities like Lyon, like Bordeaux, like to lose, people will 0:23:10.840 --> 0:23:13.800 support Emanuel Macron. The problem is not about the big cities. 0:23:13.960 --> 0:23:17.679 The problem is about even some small cities where you 0:23:17.800 --> 0:23:22.960 have unemployment rate which is exceeding and this is where 0:23:23.160 --> 0:23:27.240 definitely you find a lot of silos of potential I 0:23:27.240 --> 0:23:31.000 would say populism and people ready to vote for extremism 0:23:31.080 --> 0:23:33.159 because they have nothing to do to do. And the 0:23:33.200 --> 0:23:36.439 second point is about immigration. In France, you have a 0:23:36.440 --> 0:23:39.080 lot of immigration so it depends on where you will 0:23:39.119 --> 0:23:42.720 find this immigration. In the south east of France you 0:23:42.960 --> 0:23:45.600 find a lot of immigration issues and this is why 0:23:45.600 --> 0:23:48.480 people are voting for Mari Independent. Richard Greater speak with you. 0:23:48.480 --> 0:23:51.160 Thank you very much, Especiality Chairman of Virginalities and Associates, 0:23:51.240 --> 0:23:59.840 Joining me here in New York. Brought you by Bank 0:24:00.000 --> 0:24:04.000 of America. Mary Lynch. Dedicated to bringing our clients insights 0:24:04.000 --> 0:24:07.639 and solutions to meet the challenges of a transforming world. 0:24:08.080 --> 0:24:11.800 That's the power of global connections. Mary Lynch, Pierce Feeder 0:24:11.920 --> 0:24:21.359 and Smith Incorporated Member s I p C. There's something 0:24:21.400 --> 0:24:24.800 new from Bloomberg. It's called Lens. 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I am at Maison blanche, 0:25:13.520 --> 0:25:16.800 which is where executives come to die. And as they 0:25:16.800 --> 0:25:22.359 consider transactions and they consider the aesthetic of this nation. 0:25:23.240 --> 0:25:26.439 No one at all has any perspective on this in 0:25:26.440 --> 0:25:30.040 the linkolage to government like Renault du Trey, his chairman 0:25:30.440 --> 0:25:34.320 lvmh and so much to do with design the aesthetic 0:25:34.359 --> 0:25:37.000 of this nation of course with his public service as 0:25:37.040 --> 0:25:39.679 well a member of parliament for a long time. I 0:25:39.720 --> 0:25:43.200 want to talk about your politics, uh sir, first, which 0:25:43.280 --> 0:25:47.040 is what do you imagine the parliament elections will be 0:25:47.160 --> 0:25:51.439 June eleven and j How fractious will that process be? 0:25:52.440 --> 0:25:54.960 I think the French people are going to be a recoient. 0:25:55.440 --> 0:25:59.520 They're going to follow up, you know, yesterday's vote and 0:25:59.640 --> 0:26:04.480 gives a new president majority at you'll get a majority. 0:26:04.960 --> 0:26:07.720 That's what has been happening four years and years of 0:26:08.040 --> 0:26:11.680 the Fiefs Republic, and it totally makes sense. You don't 0:26:11.720 --> 0:26:15.639 want to have a new president if two weeks or 0:26:15.680 --> 0:26:19.280 three weeks later you deprive him have any power. And 0:26:19.359 --> 0:26:22.720 that's exactly what would happen if the president was not 0:26:23.000 --> 0:26:28.480 in the capacity of forming a new cabinet within the 0:26:28.520 --> 0:26:31.320 technology of this nation, and by that I mean a 0:26:31.359 --> 0:26:35.360 broad sense of technology, including the world class French design 0:26:35.400 --> 0:26:39.119 technology which you've helped to invent so many of that 0:26:39.320 --> 0:26:42.760 included ERICTIONE was with us that it's simply about the 0:26:42.880 --> 0:26:47.520 labor relationship and the productivity and a better economic growth 0:26:47.880 --> 0:26:51.800 will come from a better labor agreement. Are you optimistic 0:26:52.240 --> 0:26:55.680 that you can see a revolution and capitalism and labor 0:26:55.720 --> 0:26:58.560 relations in the nation. I think the next cabinet is 0:26:58.600 --> 0:27:04.400 going to be at war, war against terrorism, war against unemployment. 0:27:04.520 --> 0:27:07.359 Those are the two main issues. We have two copuies 0:27:07.520 --> 0:27:10.200 and of course if we want, you know, the companies 0:27:10.560 --> 0:27:14.760 to create more jobs, we have to add some flexibility 0:27:14.920 --> 0:27:18.679 in our labor organization. That's not easy because a lot 0:27:18.720 --> 0:27:23.480 of employees consider that if the bus, you know, has 0:27:23.560 --> 0:27:30.040 more ability to get free of employees, it's bringing less 0:27:30.080 --> 0:27:33.320 security to them. But that's the way it works. You know. 0:27:33.400 --> 0:27:36.399 We have to introduce more flexibility and that's something that 0:27:36.440 --> 0:27:38.720 a lot of people are understanding. So we have to 0:27:38.800 --> 0:27:42.280 go fast to what is going to be an efficient 0:27:42.600 --> 0:27:45.080 labor system. If you're just joining us works from No 0:27:45.240 --> 0:27:48.400 Detroit with us of LVMH David please jump in from 0:27:48.400 --> 0:27:50.800 New York City. Yeah, let me just get your perspective 0:27:50.800 --> 0:27:53.159 on why this candidate in particular was so attractive to 0:27:53.200 --> 0:27:56.040 people in the business community in France. He was young, 0:27:56.080 --> 0:28:00.720 he's untested. What what made him attractive to you and others? First, 0:28:00.880 --> 0:28:04.439 is a very pragmatic person. You know, it's not ideological, 0:28:04.640 --> 0:28:10.679 it's not sinking according to abstract patterns. He's just trying 0:28:10.720 --> 0:28:14.560 to make sure that what's going to be done is working. 0:28:15.040 --> 0:28:18.240 We need that. The two main parties of Socialist Party 0:28:18.240 --> 0:28:21.720 and the Republican parties are dead. You know, they have 0:28:21.840 --> 0:28:24.760 not been able to fix the issues. They have been 0:28:24.800 --> 0:28:28.680 governing for years and years and people are really upset 0:28:28.840 --> 0:28:32.000 with what they've been doing. So people want something new 0:28:32.640 --> 0:28:37.520 and mc coin is embodying a fresh and innovative approach 0:28:37.600 --> 0:28:41.120 of politics, much more pragmatic, being able, you know, to 0:28:41.240 --> 0:28:44.880 gather all the people who are in favor of progress 0:28:44.880 --> 0:28:49.080 of modernisation, and that's the hope is raising today And 0:28:49.200 --> 0:28:52.160 what what would you like him to do? There's the hope, 0:28:52.480 --> 0:28:54.720 there's the good will, there's the sense of change. But 0:28:54.800 --> 0:28:59.040 what concretely can he do for business in France. Um, 0:28:59.240 --> 0:29:02.320 First to love our taxes, you know, because we have 0:29:02.600 --> 0:29:05.920 a complex tax system. For instance, it's going to bring 0:29:05.960 --> 0:29:11.720 back the profit tax to which is much better than 0:29:11.840 --> 0:29:17.160 thirty three percent. He's going to suppress, um the main 0:29:17.320 --> 0:29:20.680 part of our I s F, which is the tax 0:29:20.880 --> 0:29:25.680 our wealth, so that's also highly expected. He's going to 0:29:26.160 --> 0:29:30.600 introduce a flat tax for all the income coming from capital. 0:29:31.400 --> 0:29:34.760 He's going to simplify and he's going to lower the 0:29:34.800 --> 0:29:37.640 tax burden, and that's of course is highly expected from 0:29:37.680 --> 0:29:42.600 the corporations. Second, is going to find the right balance 0:29:42.680 --> 0:29:49.880 between social fairness and economic efficiency. So he wants to 0:29:49.960 --> 0:29:54.280 invest in technologies, he wants to invest in research and development. 0:29:54.600 --> 0:29:57.440 He doesn't think that the free market is able to 0:29:57.480 --> 0:30:01.360 achieve everything. He believes in role for you know, the 0:30:01.520 --> 0:30:06.400 state and especially encouraging research. That's why he launched his 0:30:07.040 --> 0:30:11.080 call to American searcher you know, to come in France 0:30:11.160 --> 0:30:15.160 and and set it down here. So he's a very 0:30:15.240 --> 0:30:19.960 modern guy, upen to plobalization, but feeling that there are 0:30:20.000 --> 0:30:23.959 some losers in the glorization process and that something has 0:30:24.000 --> 0:30:26.520 to be done for them. No discussion. Mr Detroit could 0:30:26.520 --> 0:30:29.240 be possible without talking to you about the French ascetic 0:30:29.240 --> 0:30:32.240 where it's whether it's Air France commercials or what you've 0:30:32.240 --> 0:30:36.880 done at LVMH explained to our world audience what it 0:30:36.920 --> 0:30:40.880 means to have the American icon. Five guys, Hamburgers on 0:30:40.920 --> 0:30:45.280 the chances are you? Are you still threatening? That's not true. 0:30:45.280 --> 0:30:48.320 It's France, it is true. Five guys on chancey, Liz, 0:30:48.480 --> 0:30:50.520 You've got I mean the Disney stores. They're fine, They've 0:30:50.560 --> 0:30:54.920 got Disneyland here. Is there still a worry of American 0:30:55.000 --> 0:30:58.880 commerce and design invading your friends? We we I've been 0:30:58.960 --> 0:31:02.040 leaving a t in New York City and personal school, 0:31:02.040 --> 0:31:05.040 and you're just walking through Madison Avenue where you can 0:31:05.080 --> 0:31:07.840 see a lot of Italian and French brands, and all 0:31:07.840 --> 0:31:11.200 those shops are expressing our lifestyle and all the view. 0:31:11.720 --> 0:31:14.080 I'm not shocked by the fact that you can have 0:31:14.120 --> 0:31:17.640 an American brand in the chance it is. The question 0:31:17.920 --> 0:31:21.560 is is the food good? You know, that's a real question. 0:31:22.000 --> 0:31:26.480 If people like the Hamburgers, they will buy American Hamburgers. 0:31:26.600 --> 0:31:30.040 If it's bullshit, they will get to another brand. So 0:31:30.080 --> 0:31:33.480 the question is to bring some quality food. What people 0:31:33.480 --> 0:31:36.440 are very reluctant about is to have this kind of 0:31:36.560 --> 0:31:41.760 industrial food, and sometimes it's assimilated, you know, to global 0:31:41.840 --> 0:31:45.040 companies which are not so careful about the provenance, you know, 0:31:45.120 --> 0:31:49.120 the origin of the vegetables, of the meat, of everything 0:31:49.160 --> 0:31:53.200 which makes a good French meal. And so I'm we 0:31:53.240 --> 0:31:56.000 are in a global world. But in the same time, 0:31:57.120 --> 0:32:00.280 people in France they want to defend to protect they 0:32:00.360 --> 0:32:03.960 are the and they believe that this lifestyle and NDMH 0:32:04.080 --> 0:32:06.520 of course is a good example of that is able 0:32:06.560 --> 0:32:10.200 to be appealing to a large number of consumers all 0:32:10.200 --> 0:32:12.040 over the world. We see a transaction. I don't know 0:32:12.040 --> 0:32:14.120 if you're aware of this, but the transaction of Coach 0:32:14.320 --> 0:32:18.680 buying Kate Spain today within the United States give us 0:32:18.720 --> 0:32:21.520 a sense of the spirit of luxury right now. I 0:32:21.600 --> 0:32:24.160 was in the Gucci store next to Mr Trump's aboat 0:32:24.320 --> 0:32:26.640 the other day and it was knee deep in people. 0:32:26.800 --> 0:32:29.360 It was the buzz they're going with this brand or 0:32:29.400 --> 0:32:31.800 the other brand. I know Selin doing well and Louis 0:32:31.880 --> 0:32:35.400 Vuton the same way with your retail. But this, but 0:32:35.480 --> 0:32:39.280 this is important, David, and that is the aspiration of 0:32:39.440 --> 0:32:42.680 Mr McCraw and the new capitalism that is out there, 0:32:43.120 --> 0:32:47.080 you know, the essence of lifestyle products. It's a mixed 0:32:47.080 --> 0:32:52.760 between heritage and innovation, disception and heritage. When some companies 0:32:52.760 --> 0:32:55.440 are able to mix those two dimensions, which are appealing 0:32:55.440 --> 0:32:57.840 to two parts about our brain. We want to be 0:32:58.120 --> 0:33:00.480 comforted by what comes from the back us, but in 0:33:00.520 --> 0:33:02.600 the same time, we want to be excited by what 0:33:02.880 --> 0:33:07.200 is looking forward, which is presenting a new visage phase 0:33:07.400 --> 0:33:10.280 of the future. So that's exactly what those companies are 0:33:10.280 --> 0:33:13.320 able to do. Like you know, when Vito is asking 0:33:13.400 --> 0:33:16.160 to mark shack ups to come in and you know, 0:33:16.880 --> 0:33:21.840 get the dusts maybe out. Yeah, So it's it's always 0:33:21.840 --> 0:33:25.480 a question of high quality products first and then a 0:33:25.600 --> 0:33:29.200 cultural content. What consumers too, they are looking for is 0:33:29.280 --> 0:33:34.800 mainly culture. It's functionality, price and the celebrity matter like 0:33:35.080 --> 0:33:38.240 used to sometimes it can help, but it's not the 0:33:38.440 --> 0:33:40.880 sense of those brands. The sense of those brands is 0:33:40.920 --> 0:33:45.880 his artisanal craftsmanship, know how, coming from you know, the 0:33:46.000 --> 0:33:49.080 ages which has been protected. It's part of our common 0:33:49.120 --> 0:33:52.320 patrim one. You know, it's part of what mankind has 0:33:52.360 --> 0:33:57.320 been able to preserve over the last decades. And I 0:33:57.360 --> 0:33:59.320 think that a lot of consumers, whether it is in 0:33:59.360 --> 0:34:02.959 North American out in Asia are fond of this French 0:34:03.120 --> 0:34:07.760 and Italian lifestyle because it's it's meaning happiness, you know, 0:34:08.080 --> 0:34:11.719 a well balanced life, and I think that's the key 0:34:11.719 --> 0:34:15.200 of this success. Thank you so much. Tray with lvmh 0:34:15.360 --> 0:34:31.080 from Paris. This is Bloomberg. David Guray in New York. 0:34:31.080 --> 0:34:33.360 Tom Keene is in Paris. This is Bloomberg Surveillance on 0:34:33.400 --> 0:34:35.680 Bloomberg Radio Pleasure. Now to be joined by Richier Sharma, 0:34:36.000 --> 0:34:37.960 author of the book The Rise and Fall of Nations, 0:34:38.000 --> 0:34:40.440 Forces of Change in a Post Crisis World, which will 0:34:40.480 --> 0:34:43.239 be available in paperback next month, I believe, contributor to 0:34:43.239 --> 0:34:45.439 the New York Times editorial page as well in chief 0:34:45.480 --> 0:34:47.840 Global strategist at Morgan Stanley. Great to have you with 0:34:47.920 --> 0:34:51.479 us in our Bloomberg eleven Trio studios. Let me start 0:34:51.480 --> 0:34:54.319 with a with a broad question here this was seen 0:34:54.360 --> 0:34:57.560 as a referendum on populism. Are our reports of its 0:34:57.560 --> 0:34:59.640 death prematurity? You think that this was the death knell? 0:34:59.719 --> 0:35:02.400 Or you're still concerned about the degree to which it 0:35:02.480 --> 0:35:04.640 is a current around the world. No, I think like 0:35:04.680 --> 0:35:06.920 I'm still concerned about that, but I feel that, you know, 0:35:07.000 --> 0:35:09.840 like it's very interesting, which is that of all places 0:35:09.960 --> 0:35:12.279 where populism seems to have sort of taken a break, 0:35:12.280 --> 0:35:15.960 it's in Europe, because there was so much pessimism about, um, 0:35:16.000 --> 0:35:19.840 what what happened in Europe regarding populism, and in fact, 0:35:20.200 --> 0:35:22.160 like I think it's quite remarkable that this sort of 0:35:22.200 --> 0:35:25.160 adds to the narrative that the European continent is not 0:35:25.239 --> 0:35:28.440 a continent which is permanently doomed for crisis, but as 0:35:28.480 --> 0:35:31.239 a continent where, in fact a recovery is underway, and 0:35:31.320 --> 0:35:33.880 this political narrative is likely to change for the better. 0:35:34.320 --> 0:35:36.960 And this is something which is likely to keeping improving 0:35:37.000 --> 0:35:39.480 sentiment in Europe. I mean, for the first time, the 0:35:39.520 --> 0:35:42.799 European economy now since the crisis, is growing at a 0:35:42.840 --> 0:35:45.680 pace which is even faster than the United States. And 0:35:45.719 --> 0:35:48.120 I think that, like for me, that's the big story. 0:35:48.719 --> 0:35:50.560 You have a person now who who has been imbuted 0:35:50.600 --> 0:35:52.000 with a lot of hope, a lot of people hope 0:35:52.040 --> 0:35:55.320 that he does change the way the economy works in France, 0:35:55.400 --> 0:35:58.280 changes the way that the tax system is structured, etcetera, etcetera. 0:35:58.719 --> 0:36:00.560 How much time do you think the people of France 0:36:00.560 --> 0:36:02.319 and investors are willing to give him to do that? 0:36:02.360 --> 0:36:04.400 If anything, these last few months have been a cautionary 0:36:04.440 --> 0:36:07.960 tale here in the US investor enthusiasm and optimism matched 0:36:08.000 --> 0:36:11.800 by the realities of governance, the realities of Washington, you know, 0:36:12.320 --> 0:36:14.239 Like I was slightly sort of different take here, which 0:36:14.239 --> 0:36:16.880 is the fact that I think that there that expectations 0:36:16.920 --> 0:36:19.200 out of him are rather low, even though he's one 0:36:19.200 --> 0:36:21.279 a very decisive victory in the second round. If you 0:36:21.320 --> 0:36:23.680 read much of the commentary, it is laid in with 0:36:23.719 --> 0:36:25.799 a lot of skepticism, a lot of people sort of 0:36:25.840 --> 0:36:28.840 saying that there's not much that he can do his uh, 0:36:28.920 --> 0:36:31.680 he has to now win the parliamentary elections, and so 0:36:31.760 --> 0:36:34.920 many sort of parallels being drawn with other leaders around 0:36:34.960 --> 0:36:38.680 the world, from Rerenzy in Italy to Sarkozy himself last decade, 0:36:38.960 --> 0:36:40.840 that so many leaders have come up, you know, with 0:36:40.920 --> 0:36:43.000 so much promise, and I've been able to deliver a little. 0:36:43.080 --> 0:36:45.520 So the good news is that there's a lot of 0:36:45.520 --> 0:36:48.239 pessimism about what he can do, so the bar is 0:36:48.320 --> 0:36:50.960 quite low. And yet the mood in France seems to 0:36:51.000 --> 0:36:53.319 be turning. As I've been saying that I think that 0:36:53.719 --> 0:36:56.000 the battle for Europe is over, but the battle for 0:36:56.040 --> 0:36:59.160 France has just begun, which is that in France there's 0:36:59.200 --> 0:37:03.000 a very strong constituency in support of a single currency 0:37:03.040 --> 0:37:05.279 of the Euro, and that's something which I think even 0:37:05.520 --> 0:37:08.959 Lepine realized and shifted her campaign in the last few 0:37:08.960 --> 0:37:12.200 weeks to being more sort of anti immigrant than anti 0:37:12.280 --> 0:37:16.120 Europe per se. But within France there's a deep divide 0:37:16.120 --> 0:37:18.720 about how much and what to do with the welfare state, 0:37:18.760 --> 0:37:21.120 but at least that debate has begun. France has the 0:37:21.239 --> 0:37:24.840 largest welfare state of any country in the world, with 0:37:24.920 --> 0:37:27.759 the possible exception of North Korea. Right so, in terms 0:37:27.800 --> 0:37:30.120 of its government spending at the trade of GDP is 0:37:30.160 --> 0:37:33.720 a staggeringly high fifty seven percent, and on every metric, 0:37:33.800 --> 0:37:37.120 France has been losing out to the other countries, even 0:37:37.160 --> 0:37:39.960 within Europe in per capita income terms. That has trailed 0:37:39.960 --> 0:37:43.239 the growth of other European countries. Its labor costs have 0:37:43.320 --> 0:37:46.000 gone up at a time in other countries from uh 0:37:46.200 --> 0:37:48.719 Spain to Portugal have been cutting back on their labor 0:37:48.760 --> 0:37:52.040 costs to get more competitiveness, and a lot of people 0:37:52.040 --> 0:37:54.400 are leaving France. I think that last year the largest 0:37:54.480 --> 0:37:57.520 number of millionaires that left any country in the world 0:37:57.840 --> 0:38:01.240 was France. UH some twelve th millionaires or something left France. 0:38:01.320 --> 0:38:04.360 So this is a country that is in deep need 0:38:04.480 --> 0:38:08.399 for change. And the fact that you had Philan who 0:38:08.440 --> 0:38:11.200 managed to pull nearly twenty in the first round, and 0:38:11.239 --> 0:38:16.120 he's really a very sort of classic right winger in 0:38:16.200 --> 0:38:19.680 terms of a Thatcherite kind of person, and he would 0:38:19.680 --> 0:38:22.719 have possibly won this election had it not been for 0:38:22.760 --> 0:38:26.319 the scandal which derailed him um in the last couple 0:38:26.320 --> 0:38:29.440 of months, the personal scandal regarding his finances. So I 0:38:29.440 --> 0:38:31.360 think that this is a country which is moving in 0:38:31.400 --> 0:38:34.680 the right direction. It remains divided, but the fact that 0:38:35.080 --> 0:38:38.279 so many French people are sort of now voting for 0:38:38.400 --> 0:38:43.600 agendas that are quite reformist is I think a major 0:38:43.680 --> 0:38:48.359 step forward for a deeply socialistic country. Tom, I want 0:38:48.360 --> 0:38:51.320 to bring you in in Paris. Yeah, we're in Paris. 0:38:51.400 --> 0:38:55.000 We think many of the uber drivers of Paris who 0:38:55.000 --> 0:38:58.360 have been shocked David Gura find us on the radio 0:38:58.440 --> 0:39:01.719 dial here in Paris. Jonas I know is listening from 0:39:01.719 --> 0:39:04.520 had he just sent me in a note as well? 0:39:04.760 --> 0:39:08.000 For sure? Is France an emerging market? Is there just 0:39:08.120 --> 0:39:12.920 so much untapped technology and will that if they excuse me, 0:39:12.960 --> 0:39:15.680 if they do find the will are they the ultimate 0:39:15.760 --> 0:39:19.560 emerging market, But it depends how you define and like 0:39:19.640 --> 0:39:21.480 emerging market. I guess what you're trying to say is 0:39:21.480 --> 0:39:23.440 that there's a lot of growth potential for this country 0:39:23.440 --> 0:39:25.759 if they managed to get things right. Yeah. Sure, I 0:39:25.760 --> 0:39:27.440 think that a couple of things which France has in 0:39:27.480 --> 0:39:30.759 its favor where it shares some characteristics you can argue 0:39:30.760 --> 0:39:33.319 with other emerging market says the fact that it's demographics 0:39:33.320 --> 0:39:35.839 some better than the rest of the continent. That at 0:39:35.880 --> 0:39:39.080 least that you see, it's demographics are far superior compared 0:39:39.120 --> 0:39:42.840 to Germany as far as uh birth rates are concerned. 0:39:43.200 --> 0:39:45.800 Immigration is a is a much bigger issue because France 0:39:45.800 --> 0:39:48.880 has a pretty poor track record in terms of assimilating immigrants, 0:39:48.960 --> 0:39:51.080 let's say, compared to Anglo Saxon nations such as the 0:39:51.120 --> 0:39:54.520 United States or uh u K. But the other place 0:39:54.560 --> 0:39:56.160 I guess where you can say that France is a 0:39:56.160 --> 0:39:59.960 bit like emerging market is the fact that it's products 0:40:00.000 --> 0:40:02.440 of it is also quite high. Just the fact that 0:40:02.480 --> 0:40:04.440 people aren't allowed to work that much when you have 0:40:04.760 --> 0:40:07.840 sort of you know, like a work week which curbs 0:40:07.880 --> 0:40:09.960 working as at thirty five hours a week. So I 0:40:10.000 --> 0:40:12.040 think that yeah, in terms of the potential for France 0:40:12.080 --> 0:40:15.560 to do better from here with superior demographics and the 0:40:15.560 --> 0:40:18.600 fact that productivity can is relatively high. Just that people 0:40:18.640 --> 0:40:21.480 don't work as much, I think, yeah, in the Africa, 0:40:21.560 --> 0:40:24.720 you can call it that. And Maurice Leevey of System 0:40:24.800 --> 0:40:27.440 was adamant about the thirty five hour work week in 0:40:27.480 --> 0:40:30.439 the need to make that a piece of history for sure. 0:40:30.480 --> 0:40:32.359 Just because of the urgency of last week, I think 0:40:32.360 --> 0:40:34.799 we need to turn to your claim call on the 0:40:34.840 --> 0:40:38.120 commodity cycle. What did you make of the plummet in 0:40:38.239 --> 0:40:42.799 commodities iron ore and such, but particularly in hydrocarbons last week? 0:40:42.880 --> 0:40:44.960 What did it signal? Well? I think that you know, 0:40:44.960 --> 0:40:47.040 as far as oil is concerned, I've been saying that 0:40:47.560 --> 0:40:49.320 a lot of people suffer from what we call the 0:40:49.360 --> 0:40:52.120 anchoring bias, which that all because the price of oil 0:40:52.160 --> 0:40:54.800 went up two hundred and uh forty dollars a battle 0:40:54.920 --> 0:40:57.600 last decade. We tend to often think of the fact 0:40:57.600 --> 0:40:59.880 that the price of oil today is very low compared 0:40:59.880 --> 0:41:02.239 to those highs. But as I've been pointing out that 0:41:02.320 --> 0:41:04.920 if you look at the long term price of oil 0:41:05.000 --> 0:41:08.760 in inflation adjusted terms, the price you get is around 0:41:08.840 --> 0:41:11.880 where you are today, around a battle. So from a 0:41:11.920 --> 0:41:15.200 long term historical perspective, the price of oil today is 0:41:15.200 --> 0:41:17.760 not low. It is in line with its long term history, 0:41:17.840 --> 0:41:19.600 just that it's low compared to where we got to 0:41:20.120 --> 0:41:24.200 last decade at the fag end of a massive commodity supercycle. 0:41:24.360 --> 0:41:27.800 So in that regard, I think that oil is following 0:41:27.840 --> 0:41:30.600 the classic historical pattern, which that it had a massive 0:41:30.640 --> 0:41:32.840 boom and then a bust, and then if history is 0:41:32.880 --> 0:41:36.480 any guide, it will basically trade in a broad range 0:41:36.719 --> 0:41:39.279 for a long time to come around its historical means. 0:41:39.320 --> 0:41:41.319 So I think the price of oil is set to 0:41:41.360 --> 0:41:44.680 trade within a thirty to sixty battle for a long 0:41:44.760 --> 0:41:48.080 time to come. And after having sort of gravitated towards 0:41:48.120 --> 0:41:49.880 the high end of the range, we are possibly now 0:41:49.920 --> 0:41:52.200 headed towards the lower end of the range. And the 0:41:52.239 --> 0:41:55.520 big surprise has been just how productive US shale is 0:41:55.600 --> 0:41:58.919 and the US oil industry is. So I think that's 0:41:58.960 --> 0:42:01.080 the one big sort of driver as far as oil 0:42:01.160 --> 0:42:05.840 is concerned, the larger commodity complex. On that, my concerns 0:42:05.840 --> 0:42:09.240 still revolve around China. As I've said, is that China's 0:42:09.280 --> 0:42:12.160 grow trajectory has been on a downtrend since the start 0:42:12.200 --> 0:42:14.400 of a decade. The way I describe it it is 0:42:14.400 --> 0:42:18.320 that China's grow trajectory resembles a ping pong ball bouncing 0:42:18.320 --> 0:42:20.439 down the stairs, which is that the trend is down. 0:42:20.800 --> 0:42:23.200 But every time the trend tends to accelerate a bit, 0:42:23.560 --> 0:42:26.239 they inject more credit, more stimulus into the economy, so 0:42:26.280 --> 0:42:28.760 you get a bounce up and then the decline begins. 0:42:28.840 --> 0:42:31.480 I think that's exactly what's happened over the last year. 0:42:31.560 --> 0:42:35.080 That in jan Fab of last year, UH fears that 0:42:35.120 --> 0:42:38.480 the China would have a massive hard landing were sort 0:42:38.520 --> 0:42:42.120 of uh really growing, so they injected massive amounts of 0:42:42.160 --> 0:42:46.840 credit and stimulus into the economy to rescue the economy. 0:42:47.160 --> 0:42:51.440 That led to UH some rebounded in industrial activity, and 0:42:51.480 --> 0:42:53.600 we've seen a bounce up in commodity prices on the 0:42:53.600 --> 0:42:55.840 back of that. But now as growth seems to have 0:42:55.880 --> 0:42:59.440 peaked in China, that downtrend in growth has resumed. So 0:42:59.520 --> 0:43:02.399 I think that that's really the path that commodities are 0:43:02.400 --> 0:43:06.080 likely to follow. The broad UH point here being that 0:43:06.239 --> 0:43:09.799 after they have a big boom bus cycle, commodities tend 0:43:09.840 --> 0:43:12.520 to trade in a wide range for a long period 0:43:12.520 --> 0:43:14.799 of time and sort of don't go back to the 0:43:14.840 --> 0:43:18.719 old highs for a generation for sure. Sure. Sitting with 0:43:18.800 --> 0:43:22.319 David in New York and and share, I guess I 0:43:22.360 --> 0:43:25.719 want to talk about the correlations within the market, and 0:43:25.800 --> 0:43:30.240 not so much equities, bonds, currencies, commodities, but the correlations 0:43:30.239 --> 0:43:34.000 of the actions of chair yelling with the market. Are 0:43:34.040 --> 0:43:37.760 we tantrum like or setting us are setting ourselves up 0:43:37.840 --> 0:43:41.120 for further tantrums? Well, it could be because I think that, 0:43:41.440 --> 0:43:43.439 you know, like the I think there are two sort 0:43:43.440 --> 0:43:46.600 of conflicting forces in the marketplace. One is the fact 0:43:46.600 --> 0:43:49.440 that now finally it seems that the US is at 0:43:49.440 --> 0:43:51.960 full employment, and I find that fascinating. There's so much 0:43:52.000 --> 0:43:55.799 talk about robots displacing jobs and other things going on, 0:43:55.920 --> 0:43:57.600 but the fact of the matter is that the US 0:43:57.680 --> 0:44:02.480 today is uh at about full employment and that should 0:44:02.520 --> 0:44:05.240 finally lead to wages going higher. We've seen an uptick 0:44:05.280 --> 0:44:07.279 in wages, but so far wage growth has been quite 0:44:07.280 --> 0:44:09.799 disappointing compared to where it should have been at this 0:44:09.880 --> 0:44:13.080 stage of the economic cycle. On the other hand, I 0:44:13.120 --> 0:44:16.960 think that the deflationy forces from China continue to blow, 0:44:17.080 --> 0:44:18.719 and I think that even though we have seen a 0:44:18.760 --> 0:44:20.600 secession in that in the last year, as we just 0:44:20.600 --> 0:44:23.640 discussed with commodity prices going up and Chinese sort of 0:44:24.040 --> 0:44:27.040 producer prices skyrocketing. But I think that we are seeing 0:44:27.080 --> 0:44:29.360 a reversal of that. So I think that that play 0:44:29.520 --> 0:44:32.480 is going to continue that sort of uh conflict which 0:44:33.040 --> 0:44:35.520 on one and I see US wages going up on 0:44:35.560 --> 0:44:38.799 the other hand, because commodity prices are unlikely to do 0:44:38.920 --> 0:44:41.920 much in the foreseable future and if anything, they go 0:44:41.960 --> 0:44:45.520 to the bottom of the trading range. I think that 0:44:45.520 --> 0:44:48.919 that's what is what keeps sort of things interesting here where, 0:44:48.960 --> 0:44:52.240 you know, and that's why the tenure is barely moving 0:44:52.320 --> 0:44:54.640 in the last few weeks. But the partition here, as 0:44:54.680 --> 0:44:57.160 you know from our reading Hans Rhetoric or your colleague 0:44:57.200 --> 0:45:00.200 at Morgan Stanley, is the dollar dynamics, which to be 0:45:00.239 --> 0:45:04.520 different between Europe and the dollar dynamics with Asia ex Japan. 0:45:05.160 --> 0:45:08.920 Is Asia ex Japan the ultimate alpha opportunity of the 0:45:08.960 --> 0:45:11.120 rest of this year. Yeah, I mean in terms of 0:45:11.120 --> 0:45:13.399 the fact that you know, like we don't like talking 0:45:13.440 --> 0:45:15.719 about regions and that way, because I think that you know, 0:45:15.719 --> 0:45:19.120 there's we're among friends, we're among friends. But I think 0:45:19.160 --> 0:45:22.240 that But my concern is that I think emerging markets, 0:45:22.239 --> 0:45:25.200 including Asia X Japan have natural momentum going up because 0:45:25.239 --> 0:45:28.279 they're all reviving after you know, like a long sort 0:45:28.320 --> 0:45:31.120 of drought and time out in the wilderness. But the 0:45:31.160 --> 0:45:34.080 problem there, like I keep my one eye out on, 0:45:34.200 --> 0:45:36.640 is China. That's the one thing which could still derail 0:45:37.040 --> 0:45:39.960 the Asia x Japan story because China is still very 0:45:40.000 --> 0:45:42.680 dominant in that region. And if Chinese growth so far 0:45:42.719 --> 0:45:45.160 as slowing down after sort of having peaked in the 0:45:45.160 --> 0:45:47.279 first quarter, but if that were to really slow down 0:45:47.280 --> 0:45:50.000 any further, that's the one thing which could sort of 0:45:50.000 --> 0:45:52.160 throw a monkey range into that trade. Let me bring 0:45:52.160 --> 0:45:56.600 in surveillance x Keen in New York. David, thank you. 0:45:57.640 --> 0:45:59.520 Let me ask you about the the U S relationship 0:45:59.560 --> 0:46:02.280 with China at this point. We watched the summit unfolded 0:46:02.320 --> 0:46:04.719 marl Laga more more than a month ago. Now, I 0:46:04.960 --> 0:46:07.800 spoke with the Secretary of Commerce last week. Part David, 0:46:07.840 --> 0:46:11.080 Marlago is so April. It's so April now, I know 0:46:11.160 --> 0:46:14.799 as we push on, push on Bedminster, the new the 0:46:14.840 --> 0:46:19.279 new White House North Secretary Ross telling me last week 0:46:19.320 --> 0:46:22.120 that the strategic and economic dialogue is going to continue. 0:46:22.320 --> 0:46:24.279 What's your sense of the relationship here and as you 0:46:24.280 --> 0:46:27.080 look at the prospects for Chinese growth. How dependent are 0:46:27.120 --> 0:46:29.680 they upon that relationship with the US. Well, I think 0:46:29.680 --> 0:46:31.799 that they are very dependent because you know, there's still 0:46:31.880 --> 0:46:34.280 very much in you know, like an export par house. 0:46:34.600 --> 0:46:37.239 They're the largest exporters in the world, and if they 0:46:37.280 --> 0:46:39.880 were ever to be any sort of trade skirmishes with 0:46:39.920 --> 0:46:43.160 the US or any sort of uh god forbid, trade war, 0:46:43.280 --> 0:46:45.480 that would have a major destabilizing effect on the global 0:46:45.520 --> 0:46:47.880 economy and particularly on China. So I think that everyone 0:46:47.920 --> 0:46:50.239 here needs to trade with care. I think that's what's 0:46:50.280 --> 0:46:52.040 going on. I know this is like, this is the 0:46:52.040 --> 0:46:56.120 broader question, which is that in November, uh, the entire 0:46:56.160 --> 0:46:59.680 discussion was about what effect would Trump have on markets? 0:46:59.680 --> 0:47:01.680 And we think in the markets was all about the 0:47:01.680 --> 0:47:04.840 Trump administration. Here we are in me and it's amazing, 0:47:05.000 --> 0:47:07.120 you know, like how investors have moved on, which is 0:47:07.120 --> 0:47:09.879 that in the in the in the marketplace now there 0:47:09.960 --> 0:47:12.759 is very little discussion about the Trump effect. It was 0:47:12.840 --> 0:47:15.760 all gone back to sort of assessing each asset class 0:47:15.840 --> 0:47:18.719 or each trend on its own, and very little discussion 0:47:18.719 --> 0:47:21.680 about Trump. So I find this amazing disconnect that that 0:47:21.840 --> 0:47:26.440 in the in the general political discourse, no conversation can 0:47:26.480 --> 0:47:28.880 begin or end without a discussion about what Trump is 0:47:28.920 --> 0:47:33.319 doing or what the Trump administration is doing in the marketplace. 0:47:33.360 --> 0:47:35.600 You know, like we UH, we had a whole bunch 0:47:35.640 --> 0:47:37.839 of our team which attended the I m F World 0:47:37.840 --> 0:47:41.839 Bank Conferences in d C last months, and they came 0:47:41.840 --> 0:47:44.200 back with the impression that very few people there are 0:47:44.200 --> 0:47:46.520 now talking about Trump anymore or the effect that Trump 0:47:46.560 --> 0:47:49.200 is having. So we've gone from this amazing sort of 0:47:49.640 --> 0:47:53.480 discussion in UH November where everything was about you know, 0:47:53.480 --> 0:47:55.400 what will happen, you know what effect will Trump have 0:47:55.520 --> 0:47:58.520 on every single relationship in the world, And now we 0:47:58.520 --> 0:48:00.360 have gone to that place where people are like, you 0:48:00.400 --> 0:48:03.319 know what, there's not that much he can make a 0:48:03.320 --> 0:48:05.480 difference to. So people have gone back to sort of 0:48:05.480 --> 0:48:08.480 looking at each trend UH individually and from a very 0:48:08.480 --> 0:48:11.960 economic standpoint. Now you're gonna watch that that menuet unfold 0:48:12.760 --> 0:48:14.560 later this month at the G seven in Italy. You 0:48:14.880 --> 0:48:17.279 have President Trump traveling there to meet with his counterparts, 0:48:17.320 --> 0:48:21.160 his first trip trip overseas. I imagine we're going to 0:48:21.200 --> 0:48:23.080 see play out there. We've seen that play out before 0:48:23.080 --> 0:48:26.520 with his trips. The Treasury Secretary has taken trips the 0:48:26.560 --> 0:48:28.440 Secretary of State has taken there will be a lot 0:48:28.440 --> 0:48:31.720 of counterparts curious as to what this president thinks about 0:48:31.719 --> 0:48:33.799 the world order, what he's going to do, What are 0:48:33.800 --> 0:48:36.080 you going to be watching for? Well, I think that 0:48:36.120 --> 0:48:38.120 in terms of you know, like, you know what the 0:48:38.200 --> 0:48:41.120 dynamics are, you know, how exactly like it plays itself out. 0:48:41.160 --> 0:48:43.560 But my feeling is that from a financial market standpoint, 0:48:43.600 --> 0:48:45.480 this is going to be a basic non event, which 0:48:45.520 --> 0:48:47.600 is the fact that you know, G seven meetings have 0:48:48.160 --> 0:48:50.600 long ceased to have any effect as far as investors 0:48:50.640 --> 0:48:53.440 are concerned. And I think that I know that you 0:48:53.520 --> 0:48:57.200 will be intense focus in the in the political space 0:48:57.280 --> 0:48:59.720 and in the media about Trump and how he's interacting 0:48:59.719 --> 0:49:01.840 with other leaders and stuff at that. But from a 0:49:01.880 --> 0:49:05.440 financial market standpoint, I think that people are you know, like, uh, 0:49:05.480 --> 0:49:08.400 we've got to separate that discussion completely from the political theater. 0:49:08.680 --> 0:49:11.360 For sure. I gotta make money to get home, right now? 0:49:11.560 --> 0:49:14.040 Do I need to go short oil? Nobody seems to 0:49:14.040 --> 0:49:17.919 be predicting forty two or even to preach forty thirty 0:49:18.040 --> 0:49:22.040 nine oil. What is that likelihood the probability of breaking 0:49:22.080 --> 0:49:24.399 out of the Mother of All ranges? Well, I think 0:49:24.400 --> 0:49:27.960 that the probability is high, which is the fact that 0:49:27.960 --> 0:49:30.640 the that the dynamic on the oil market still seems 0:49:30.640 --> 0:49:33.000 as if you know, prices want to get lower. And 0:49:33.800 --> 0:49:35.960 I think you rightly point out very few people are 0:49:36.000 --> 0:49:39.000 prepared for lower prices because everyone's been thinking that the 0:49:39.120 --> 0:49:41.000 risk is to the upside. So yeah, I mean, if 0:49:41.000 --> 0:49:44.400 you want to buy downside sort of a breakout stuff, 0:49:44.760 --> 0:49:48.359 it's possibly better than buying an upside option. Here are 0:49:48.360 --> 0:49:52.120 you watching OPEC, what's the likelihood that production freezes continued? Well, 0:49:52.160 --> 0:49:53.680 I think that you know, I mean like they will 0:49:53.719 --> 0:49:55.840 likely continue, But I think the part of OPEC is 0:49:56.000 --> 0:50:00.239 greatly overstated. I think that you know, well that pick 0:50:00.280 --> 0:50:02.200 makes for great headlines and what happens there, but I 0:50:02.200 --> 0:50:04.480 really feel the power is overstated. And in the end, 0:50:04.520 --> 0:50:07.520 it's back to the same discussion that uh, you know 0:50:07.560 --> 0:50:09.440 that do they want to lose more market share to 0:50:09.600 --> 0:50:13.120 US shale because it's come back in such a big 0:50:13.120 --> 0:50:15.160 way and seemed to be much more productive than people 0:50:15.200 --> 0:50:17.799 that expected. I'm not quite sure they want to do that. 0:50:18.239 --> 0:50:22.120 Your your classic reshers breakout nations in pursuit of the 0:50:22.160 --> 0:50:26.839 next economic miracle? Where is the next economic miracle? Could 0:50:26.840 --> 0:50:31.279 it be the recovery of Venezuela, of the absolute heartbreaking 0:50:31.400 --> 0:50:34.279 bottom or is it some other story Now, I think 0:50:34.320 --> 0:50:36.719 that Latin America in general is doing much better. I 0:50:36.719 --> 0:50:38.440 think it's a continent which you know, we don't talk 0:50:38.480 --> 0:50:41.200 about that much, but it's the one continent still following 0:50:41.239 --> 0:50:44.839 the economic orthodox model. I was in Brazil last month. 0:50:44.880 --> 0:50:46.719 I was really impressed by the kind of reforms that 0:50:46.760 --> 0:50:49.080 Brazil is carrying out with it's back to the wall. 0:50:49.160 --> 0:50:51.960 But that's the story that all countries which have their 0:50:52.000 --> 0:50:53.719 back to the wall are the countries which carry out 0:50:53.760 --> 0:50:56.760 economic reforms, because that's the only time that they seem 0:50:56.840 --> 0:50:58.719 to do, and that's what's going on. But I think 0:50:58.719 --> 0:51:01.000 the big trend in the world it is that the 0:51:01.080 --> 0:51:04.280 US market seems to be hitting a relative peak compared 0:51:04.320 --> 0:51:06.640 to the rest of the world, with the dollar also 0:51:06.640 --> 0:51:10.440 showing signs of exhaustion. So I think the opportunities are international, 0:51:10.600 --> 0:51:13.800 whether it's Europe, it's Japan, it's parts of emerging markets. 0:51:14.080 --> 0:51:16.680 I'm finding much more opportunity international now than here in 0:51:16.719 --> 0:51:19.160 the United States. For sure. Thank you so much, as 0:51:19.200 --> 0:51:21.279 always for thank you from Paris. I'm sure David will 0:51:21.360 --> 0:51:24.239 greet us out here, but It's just wonderful, folks, to 0:51:24.320 --> 0:51:27.720 have Mr Sherma with us of Morgan's Daddy. Global coverage 0:51:27.719 --> 0:51:30.040 continuing here on Bloomberg Surveilance for Shere Scharman, the Global 0:51:30.440 --> 0:51:32.640 head of Strategy at Morgan Stanley, the author of The 0:51:32.719 --> 0:51:34.960 Rise and Fall of Nations and Incredible Forces of Change 0:51:34.960 --> 0:51:37.160 in a post crisis world. As I said out in Hardback, 0:51:37.200 --> 0:51:40.280 now available in paperback next month. Look for his columns 0:51:40.560 --> 0:51:51.920 in The New York Times monthly as well. Thanks for 0:51:52.000 --> 0:51:56.080 listening to the Bloomberg Surveillance podcast. Subscribe and listen to 0:51:56.160 --> 0:52:02.240 interviews on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. 0:52:02.800 --> 0:52:05.839 I'm on Twitter at Tom Keene. David Gura is at 0:52:05.960 --> 0:52:10.799 David Gura. Before the podcast, you can always catch us worldwide. 0:52:11.000 --> 0:52:25.120 I'm Bloomberg Radio, brought you by Bank of America Mary Lynch, 0:52:25.239 --> 0:52:29.480 dedicated to bringing our clients insights and solutions to meet 0:52:29.520 --> 0:52:33.000 the challenges of a transforming world. That's the power of 0:52:33.040 --> 0:52:38.120 global connections. Mary Lynch, Pierce, Feeder and Smith Incorporated Member 0:52:38.760 --> 0:52:39.440 s I p C.